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Research Highlights 2009: Human Development and Public Services

Human development and public service delivery are at the core of the World Bank’s strategy to improve people’s lives and support sustainable development. The research program aims to deepen understanding of the factors affecting human development, measure the quality and impact of service delivery, and analyze the economic and political institutions that affect those services.The program also includes research on labor and migration and the effectiveness of development aid.

Themes

This research program continues to cover the full gamut of human development—education, health, labor markets, and social protection. It examines the performance of the sectors in terms of levels and inequalities in utilization, quality, and outcomes. It also examines the impacts of measures to improve performance. These include measures aimed at households, such as conditional cash transfer and health insurance programs, as well as measures aimed at service providers, including payment reforms and legal institutions1,2, and community monitoring mechanisms.3 The behavior of policy makers and politicians also has an important bearing on human development outcomes, and continues to be an area of study.4 In light of this year’s global financial crisis, the team has examined impacts of the crisis on human development outcomes and on development assistance; the latter continues to be an important part of the work program.

Highlights

The impacts of the crisis on human development and development assistance

Between 1977 and 2007 several banking crises occurred in donor countries. They appear to have been associated with substantial additional reductions in aid flows, beyond any income-related effects, perhaps because of the high fiscal costs of the crisis and the debt hangover in the post-crisis periods.

Donor-country incomes are also related to per-capita aid flows. Because donor countries are being hit hard by the current global recession and several have also suffered banking sector crises, aid is likely to fall by a significant amount in coming years.5

Our estimates suggest that between 30,000–50,000 more infants will die in Africa this year as a result of the crisis. These numbers are large but smaller than previous estimates, in part because of the use of more recent International Monetary Fund growth forecasts and in part because of the use of microdata from multiple Demographic and Health Surveys.6

Conditional cash transfer programs—taking stock, and new angles

The growing use of conditional cash transfer (CCT) programs was examined in a timely Policy Research Report.7 The report concluded that CCT programs have reduced short-term poverty, and increased enrollment in education and use of health services, but had only very modest impacts on education and health outcomes. Cambodia’s scholarship CCT program increased attendance by approximately 25 percentage points among the target population (poor households). However, 18 months after the scholarships were awarded, the recipient children did no better on mathematics and vocabulary tests than they would have done in the absence of the program. Self selection by lower-ability students into school as a result of the program appears to explain the lack of the program’s impact on test scores.8 Transfers in CCT programs are also subject to diminishing returns. These were evident in the Cambodia program even though the transfers in the program are equivalent to only 3 percent of the consumption of the median recipient household.9 In the Cambodia program, there was also no effect on school attendance of siblings, despite the positive effect on household income of the scholarship program.10

Improving education outcomes

A randomized trial assessed the impact of two school feeding schemes (school meals and take-home rations) on health and education outcomes for children from low-income households in northern rural Burkina Faso. After one academic year, both programs increased girls’ enrollment by 5 to 6 percentage points but there were only modest impacts on learning. Take-home rations had the added advantage of improving the nutritional status of younger siblings.11

Education research typically assumes that children’s learning persists from one grade to the next. New research from Pakistan suggests that actually only one-fifth to one-half of a student's achievement persisted from one grade to the next. Assuming full learning persistence also masks the large learning advantage of private over public schools, equivalent to the test score gain between third and fourth grade when modeled correctly.12

Improving health outcomes through demand- and supply-side reforms

Many countries are striving to improve insurance coverage among the informal sector. An evaluation of China’s rural health insurance program found a positive impact on utilization but no impacts on out-of-pocket spending.13 The emphasis on fee-for-service which gives health providers an incentive to deliver more—and more expensive—care can explain this outcome.

How to finance health insurance is also a much-debated topic. European and Central Asian countries shifting from tax-financed health coverage to a social health insurance system saw their health spending and use of services increase, but saw no reduction in mortality from conditions amenable to medical care.14 Hospital payment reforms in these countries also produced mixed effects.15 Compared to historical budgets, fee-for-service and patient-based payment methods (mostly variants of diagnosis-related groups) increased national health spending but had no clear-cut effects on utilization or amenable mortality.

Public health is often downplayed. India’s central government’s policies, though well-intentioned, have inadvertently de-emphasized environmental health and other preventive public health services since the 1950s, when medical and public health services were amalgamated to focus public health services largely on single-issue programs.16 Tamil Nadu, unlike the rest of India, has maintained separate medical and public health services, apparently with positive results.17

HIV/AIDS—new insights

Education turns out not to be positively associated with HIV status.18 But schooling does predict protective behaviors such as condom use, use of counseling and testing, discussion of AIDS between spouses, and knowledge about HIV/AIDS. On the negative side, education also predicts a higher level of infidelity and a lower level of abstinence.

Condom use is disappointingly low in Africa. Men use condoms more frequently than women, and unmarried people use condoms more frequently than married people do with their spouse. There is a clear gender difference in condom use with extramarital partners: married men use condoms with extramarital partners about as frequently as unmarried men; however, married women use condoms with extramarital partners less frequently than unmarried women.19 In the overall population there is an association between remarriage and HIV infection,20 but few consistent and significant patterns of HIV prevalence by socioeconomic and demographic status.21

Development assistance

Foreign aid has often been used by donors to entice recipient nations into policy and institutional reforms favorable to private sector economic development, but the evidence is mixed.22 Aid has no significant effect on economic freedom overall, but nonetheless contributes toward a policy and institutional environment favorable to growth. Foreign aid and—to a lesser extent—windfall revenues from natural resources also reduces the quality of developing-country tax systems.23 A consensus view holds that developing-country systems are strengthened when donors trust recipients to manage aid funds, but undermined when donors “micro-manage” aid through their own separate parallel systems. Donor trust in country systems depends on the quality of public management systems in place, the tolerance for risk on the part of the donor’s constituents, and ability of donors to internalize the benefits of investing in country systems.24

Barnhardt, Sharon, Dean Karlan, and Stuti Khemani. 2009. “Participation in a School Incentive Programme in India.” Journal of Development Studies 45(3): 369-90.

4.

Keefer, Philip, and Stuti Khemani. 2009. “When Do Legislators Pass on Pork? The Role of Political Parties in Determining Legislator Effort.”American Political Science Review 103(1): 99-112. (Based on Policy Research Working Paper 4929)